"Page Cannot Be Found" Issue when Previewing via Expression Blend

When you preview a Silverlight application in Expression Blend, we run the ASP.NET Web Development server in the background to preview your content in an environment that emulates a real-world web server:

On March 9, a signature update to Windows Defender and Microsoft Forefront Security was released that modified your system’s hosts file to address a vulnerability. One of the side effects of this update was that an entry for localhost may have been removed from your hosts file.

This means that, when you preview your application using the ASP.NET Development Server, your browser will simply show a “Page cannot be displayed” (or equivalent) message.

To fix this problem, open C:\Windows\System32\drivers\etc\hosts in Notepad, and add the following entry:

127.0.0.1 localhost

For example, here is what my hosts file looks like (as Lucas pointed out in the comments, if you are not running Windows 7, the below lines may not be commented out):

A subsequent signature update to both Windows Defender and and Forefront Client Security, released on the same day as the earlier update, should not cause this problem.

In VS2008, debugging my solution will start two development servers, one for the web server and another one for a WCF service in the solution, however, using Expression Blend 3 RC, I do not get the second expected development server. Does anyone have any recommendations? Is this a limitation of Blend?